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TDM Berhad Foresees Positive Future Outlook Supported by Twin Growth Engines of Plantation and Healthcare

23th June 2022 – TDM Berhad concluded its 57th Annual General Meeting today. All resolutions were approved by the attending shareholders.

Stepping into the second year of its 5-year Strategic Business Plan, the Group is shifting into higher gears to capitalise on favourable macro trends in both plantations and healthcare industries. To date, TDM has already made promising progress on our strategic expansion plans and efforts to unlock value from existing assets

The Group has benefitted from the sharp rise in crude palm oil average selling prices which increased from RM2,822 per metric tonne (MT) in 2020 to RM4,447 per MT in 2021. In the first quarter of 2022, CPO average selling prices surged even further to RM5,904 per MT. 

TDM is also working closely with the respective parties to conclude the proposed disposal of our two Indonesian subsidiaries which have been loss-making since their first year of production and acquisition. This is a positive move as the disposal will raise RM115.0 million in cash, reduce borrowings and improve capital requirements. Instead of sustaining loss-making operations, we will be able to allocate resources to strengthen our Malaysian businesses which are generating positive returns

Exacerbated by geopolitical tensions, food security has become a concern globally and in Malaysia. In contributing to food sufficiency within Malaysia and expanding our revenues streams, TDM will be utilising unplanted land areas to cultivate cash crops. 

Starting with chilli cultivation, the venture is currently commencing on a five-acre parcel of land, with the target of expanding to 200 acres by the year 2025. To improve crop yield and reduce operational costs, the Group adopts Internet of Things (IoT) smart farming solutions to monitor crop fields with the help of sensors and automate the irrigation system.

In TDM’s healthcare segment, the global pandemic and an ageing population in Malaysia have increased the need for healthcare services in the country. As such, the Group plans to extend its coverage with both brownfield and greenfield expansions. TDM recently completed the acquisition of Tawau Specialist Hospital, now known as KMI Tawau Medical Centre following the Group’s post-acquisition plan, under such strategy

On the execution of greenfield expansions, the Group is working towards providing a network of multidisciplinary specialist hospitals to serve more communities across the East Coast of Malaysia. Its current ventures entail the construction of the first specialist hospital with a capacity of 100 beds on a 5.4-acre land in Kemaman, Terengganu, which is expected to begin next year, and another private hospital with a capacity of 94 beds on a 9.56-acre land in Bandar Baru Tunjong, Kota Bharu, Kelantan.

The establishment of Ambulatory Care Centres at strategic locations along the East Coast of Malaysia is currently ongoing and progressing as planned. On top of these expansion efforts, TDM is also exploring potential collaborations with other leading hospitals to set up new Centres of Excellence.

In the financial year ended 31 December 2021, earnings before interest, tax, depreciation, and amortisation (EBITDA) for the plantation division jumped by 96.5% to RM176.5 million while the healthcare segment reported an 80.2% increase in EBITDA to RM23.6 million. 

During the meeting, TDM shareholders approved a single-tier final dividend in respect of FY2021 of 0.35% on 1,722,881,001 ordinary shares. The Group’s solid progress and efficient operations have been translated into a dividend pay-out of RM6 million. The shareholders gave their endorsement to the payment of the final single-tier dividend of 0.35 sen per ordinary share. This contributed to a total dividend of 0.64 sen per ordinary share for FY2021, which is the highest since 2016. 

Looking at FY2022, TDM is confident in building positive momentum from the strong operating results of FY2021. Underpinned by the twin growth engines of plantation and healthcare, the Group is looking forward to creating better value for our shareholders over the foreseeable future.    

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